topic Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another? in Mortgage Loans

Help. I "hate" my new house! VA loan. Can I sell this and buy another?

gpeach — Thu, 05 Nov 2009 04:45:59 GMT

Is there any VA requirements to staying so long? I know if you rent it out you have to live in it for 2 years before selling it. We closed in July and have never rented it out.

The layout is not working at all for the family. Causes much stress. The house is beautiful. The builder did a wonderful job. I love to look at it. We built one of the hottest development in town and is almost complete. Like maybe 8 lots left. Don't think it would be a problem to sell. Possibly even get a small profit since it is like new and ready to go. Am I crazy?

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

Anonymous — Thu, 05 Nov 2009 04:57:30 GMT

you are unlikley not to be upside down on the new home unless you put alot of $ down. Buying in a new developement, people do not pay full price for a home when they can order one exactly how they want for the same price. The builder can also offer concessions to buyers you can not (expensive upgrades, financing deals, etc) Also, by the time you factor in realtor fees and concession to sell (assume close to 10% total, you may be able to sell for what you owe right now, but probably only if you put alot of $ down. Only a realtor can tell you what your house can realistically get and what the fees/etc will likley run. You have to weigh that against the money you owe.

What exactly is not working for you, and can it be addressed without selling the home. Eating the realtor fees and closing costs to sell then buy again is a huge waste of money.

Not sure about the VA stuff. I thought you could only get 1 VA loan in your life (that's what my -ex air force- dad told me), but things I have seen on hear may contradict that.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

wfreeman3 — Thu, 05 Nov 2009 10:43:05 GMT

I can answer the "only 1 VA loan question". You can only have 1 VA loan at a time, but if you sell the home you have a VA loan on, you can get another.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

DallasLoanGuy — Thu, 05 Nov 2009 14:23:22 GMT

get a realtor. have them work up a net sheet after expenses.

no problem selling.

however, your va funding fee will be higher on the next loan

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

fishbjc — Thu, 05 Nov 2009 15:56:40 GMT

I also live in a hot development....still people want new and will pay for it. We have had newer homes sell, but at a great loss after fees, etc.

Plus, the builder will usually cut deals on the few remaining lots. Grrrr, I hate that!!!!

Realtors fees will take a big chunk out, plus there are people who will want the carpeting replaced, yadda yadda yadda.

It doesn't hurt to call a realtor though...why not?

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

demo18c — Fri, 06 Nov 2009 02:57:40 GMT

Sorry but you are mistaken. You can have two houses if when buying the new one is less or meets the remainder of your eligibility. If it doesnt meet then you will have to have a down payment to cover the balance., My current home I bought under VA and the one I am building now is VA

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

gpeach — Tue, 10 Nov 2009 16:47:47 GMT

Thank you for all the advice. I met with realtor and she did a market analysis. Very neat report. Since the builder has raised prices and based on what is selling she recommended a price that is almost 20,000 over what we paid! Add VA funding fee to loan and the commission we don't make anything but that is okay. There is a few thousand in the asking price for negotiations. We are buying another house from the same builder and using the same agents. So they cut the commision for us otherwise this could not happen. And the builder is being generous with a lot upgrade and extra bedroom in the plan at no charge.

Now about our 8,000 credit. From the credit form and information I gathered so far if we sell it in 2010 and we don't gain anything on it we get to keep the 8,000. We did not do ammended. We were waiting to put on our 2009 taxes.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

Anonymous — Tue, 10 Nov 2009 16:58:49 GMT

Make sure you have an accountant or someone at the IRS check your info for you. I know with the initial program, you had to stay in the house. If you sold it within a certain time, you had to repay it. That was the 7500 credit though. I may be wrong, but I wold be surprised if there was not a clause about remaining in the home for a couple years at least (but there might not be). Also, make sure that when you are talking about "gaining" on the home, exactly what IRS considers gains. I do not know if IRS goes by the sale price or the cash you recieve. I have heard it is the price the home sells for, not the sale price minus commissions and costs involved. In that case, you may be "gaining" on the sale it appears. Again, I do not know the answer to these questions, just make sure you are having a professional (and not someone involved in this transaction) answer your questions clearly.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

Anonymous — Tue, 10 Nov 2009 18:48:27 GMT

@Anonymous wrote:
Make sure you have an accountant or someone at the IRS check your info for you. I know with the initial program, you had to stay in the house. If you sold it within a certain time, you had to repay it. That was the 7500 credit though. I may be wrong, but I wold be surprised if there was not a clause about remaining in the home for a couple years at least (but there might not be). Also, make sure that when you are talking about "gaining" on the home, exactly what IRS considers gains. I do not know if IRS goes by the sale price or the cash you recieve. I have heard it is the price the home sells for, not the sale price minus commissions and costs involved. In that case, you may be "gaining" on the sale it appears. Again, I do not know the answer to these questions, just make sure you are having a professional (and not someone involved in this transaction) answer your questions clearly.

I'm pretty sure you have to stay in the house for 36 months or pay back the $8000. I definitely agree with mickie that you should look into that.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

Anonymous — Tue, 10 Nov 2009 18:52:29 GMT

I am pretty sure you need to be in the house for 3 years...ok so I just looked it up and confirmed that... http://www.cbsnews.com/stories/2009/11/09/business/moneywatch/main5592550.shtml. It used to be posted on the official tax credit website but I can't seem to find it. Anyway, the government doesn't want flippers to take advantage, so you do have to stay in the house for 3 years after closing or repay it.

Re: Help. I "hate" my new house! VA loan. Can I sell this and buy another?

gpeach — Tue, 10 Nov 2009 23:20:07 GMT

I am going to talk with a CPA and the IRS to be sure. But below is what I found. I am not a flipper. I just hate the floorplan and it is not working for our family. We were planning on moving about 4 years from now. We decided why stay. Even if we don't keep the 8000 in the big picture we are fine with it. We would end up losing a thousand or two overall. Here is what I got from the 5405 form that you get the credit on.

PASTED EXACTLY FROM THE 5405 form:

Homes purchased in 2009. You must repay the credit
only if the home ceases to be your main home within the
36-month period beginning on the purchase date. This
includes situations where you sell the home, you convert
it to business or rental property, or the home is
destroyed, condemned, or disposed of under threat of
condemnation. You repay the credit by including it as
additional tax on the return for the year the home ceases
to be your main home. If the home continues to be your
main home for at least 36 months beginning on the
purchase date, you do not have to repay any of the
credit.

If you and your spouse claim the credit on a joint
return, each spouse is treated as having been allowed
half of the credit for purposes of repaying the credit.

Exceptions. The following are exceptions to the
repayment rule.

c If you sell the home to someone who is not related to
you, the repayment in the year of sale is limited to the
amount of gain on the sale. (See item 8 under Who
Cannot Claim the Credit for the definition of a related
person.) When figuring the gain, reduce the adjusted
basis of the home by the amount of the credit.

Now I looked up what the IRS considers a gain and it is after expenses like commissions.